OPEC and the oil price / OPEC och oljepriset

At the moments it feels as though my standard answer to the question on the future price of oil, ”It will be what we are willing to pay” is more justified than ever. It is primarily the Americans who have reduced their consumption. Over the last four weeks consumption in the USA has been 18.7 million barrels per day. That is 8.5% lower than it was approximately one year ago, i.e. 1.7 million barrels per day less. The USA consumes approximately 25% of the world’s oil and if consumption for the rest of the world has decreased by the same amount as the USA’s reduction, then the global decrease would be on the order of 3.5 million barrels per day. The decision from OPEC to reduce production by 1-2 million barrels per day will not lead to a shortage of oil. We see now that the decision has had no effect on the price. At the moment oil is selling for $64 per barrel.

The International Energy Agency, IEA, has earlier stated that global growth of 3% per year requires increased oil consumption of 1.4% per year. The question is now how a global oil consumption drop of 4-5% will affect global growth. The psychological effect can be that we all buy fewer things which will slow the economy. The winner is the environment since carbon dioxide output will decrease.